Daniel Talks Agency Marketing: Defining Your Target Market

Daniel Talks Agency Marketing:Defining Your Target Market

Build a Segment That Your Agency Can Reach for Growth

written by Daniel Smith, CAE

Why should agencies market themselves? How should they market themselves? In this series I will look into agency marketing techniques and strategies and how you can implement them at your agency.

My simple definition for the term "marketing" is any action that creates demand for a product or service. Over the last couple of years, I have seen a slew of "master groups," marketing "gurus," Facebook groups and forums with people that are self-described marketing experts. Many of them have good ideas, and many of them don't. Many of them have been successful in this industry, and many of them haven't. The one thing they all seem to have in common is that they want to sell you something.

If you're reading this, it is likely that you are already an Insurors member. I'm not trying to sell you any insider group or program, I just want to add additional value to your agency by sharing some ideas on how you can market your agency. The strategies I discuss may not be something you want to implement, but I can promise you that if you do put time, money and effort behind them they will be successful.

One critical piece of building a target market is that it has to be one you can reach with your efforts

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Beginning the Process

I feel the most effective way to begin building a strategy for marketing is to determine your overall target market. The reason we do this is because defining a target market allows you to focus you efforts on prospects that are more likely to be interested in what you have to offer.

For some of you that may be easy, other agencies may need to look a little harder. To determine this top line, begin by asking questions about your operations:

• What segment(s) of business is currently bringing in the most premium?

• What segment(s) of business is currently bringing in the most revenue?

• What segment(s) of business is seeing the most growth?

• What segment(s) of business is declining?

• In what segment(s) of business does our carrier mix give us a competitive advantage?

These questions should give you some insight into where you can focus on for growth and where you need to focus on for retention. But this is just the top level, we need to drill down even further.

Market Segmentation

There are many words for it, but segmenting data is key to marketing in today's world. If you find that cyber insurance is an area your agency is growing in, trying to market to everyone with a computer is not a good strategy. However, if you know that your carriers have great coverage options on cyber for small business, it only makes sense to target the small businesses in a defined territory that your agency serves. You can go even further than that by defining the types of small businesses that would or should be more receptive to cyber coverage, such as those that store a lot of customer data.

Use your knowledge and the data your agency has to drill down. Take the segment of business you're studying and look for keys and consistencies. Are artisan contractors an increasing segment for you? Are you writing more small owner-operator trucking policies? Combining that info with what you know about your local economy will give you insight into areas that your agency can grow. Is your local economy seeing more restaurants open, homes being built, boats being purchased, etc.? Are people worried about the local economy in your area and looking to protect their assets more? That tend may give you opportunities as well, especially if you carriers with competitive pricing.

Next, define the perceived strengths and market segments for your main competitors as best you can. If you're not sure, visit their websites and do Google searches for specific lines of insurance and see what and who comes up. This will help you assess the overall marketplace.

Take these factors and break down your agencies target market like this: age range, occupation, location, income range and likely level of education. Again, if you don't know, a Google search can help you fill in the data. After that, consider the likely personal characteristics of those in the target market. What is their personality generally like? What interests them? What are their common values and lifestyle choices? Talk with your producers and staff and see what they think of these clients and how they would describe them. If you really what to do it the right way, put together a survey of these customers or talk with a research firm to help you gather the data.

Evaluate What You Have Found

Once you feel good about the results you have collected, ask yourself some questions about the market you have defined. Inc. magazine suggests you ask the following questions about this group 1 :

1. Are there enough people who fit my criteria?

2. Will my target really benefit from my product/service?

Will they see a need for it?

3. Do I understand what drives my target to make decisions?

4. Can they afford my product/service?

5. Can I reach them with my message? Are they easily accessible?

If you are encouraged by the answers to these questions, you have likely found a target market that is worth placing resources into reaching. In the next issue, we'll discuss how you can do just that.

1 - per "How to Define Your Target Market" via https://www.inc.com/ guides/2010/06/defining-your-target-market.html

About the Author

Daniel Smith serves as the Chief Marketing Officer for Insurors of Tennessee. He has a Bachelors degree in Marketing with a minor in Graphic Design from the University of Tennessee at Chattanooga, and earned his Certified Association Executive (CAE) designation in 2017. He may be contacted at dsmith@insurors.org. u